Idearc Sees Flat 2007 Results
Idearc Media released its first-half financial results this morning. The company emphasized that “multi-product” sales, combining print, online and other, were about flat. Idearc is maintaining full-year guidance for 2007 – revenues will come in “close to flat” with slight OIBITDA margin contraction.
Print directories continue to be down, but Idearc says the trend in print is improving, helped along by companions and the expansion of niche products. Superpages.com continues a strong pace of growth, rising 33 percent in the second quarter and 32 percent in the first half. The following are some highlights from Idearc’s announcement.
- Multi-product advertising sales were essentially flat in the first half of 2007, reaching US$1.61 billion, down 0.2 percent from the same period in 2006. Superpages.com revenues increased 32 percent, from US$107 million to US$141 million in the first half of 2007. Print revenues were down 2 percent in the first half, to US$1.47 billion, while “other” revenues were down 80 percent to US$2 million.
- Idearc launched a video advertising beta test in Seattle, Los Angeles and the San Francisco Bay Area. After the test period, the plan is to sell the product on a pay-for-performance basis.
- The company signed additional distribution agreements during the quarter – V-ENABLE, DirectoryM, Multiplied Media, HappyMedian, Neighborhood.com and Jingle Networks. Advertisers can now appear on more than 250 Internet sites.
- Superpages.com debuted a new search algorithm. The relevancy-based algorithm matches consumers’ queries with ad criteria including relevancy, performance and bidding.
- The company implemented an affiliate program called LocalServe that allows Web sites to offer a Superpages.com search box on their sites.
- It also launched an editorial content section called Underground Shopper in its Dallas and Fort Worth-Arlington print directories.
- Idearc CEO Kathy Harless said on the call that she is pleased with the performance of Idearc’s sales force and the new reps continue to improve every day. She indicated additional salespeople were likely to be hired later in the year on both the incumbent and independent sides of the business.
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Idearc needs to cut costs fast given their top line will remain flat. Since they came from
Telco heritage, I’m sure there will be pretty of “fat” to cut. A tell tale sign is that they
have close to 8000 people but only 3000 are in Sales. Pretty fat overhead.